In the filing, Netflix noted that it is still convinced it made the correct choice in splitting its disc and streaming subscription plans. Its unchanged fiscal guidance implies that it is seeing that the higher ARPU (average revenue per user) from discs-plus-streaming subscribers seems to be offsetting revenue lost due to those defecting from the disc-only side of the service. With revenue held steady, losing those 800,000 disc-only subscribers is a net positive because of the savings in management and fulfillment seen by several million fewer annual by-mail disc transactions.

Crucially, Netflix guidance points to far less churn from 'Watch Instantly' subscribers than from disc-by-mail users (guidance lowered by 0.9 per cent for former vs. 5.3 per cent for the latter). As the company aspires to shift its strategy away from disc-by-mail business the digital user churn (whether back to a physical-only product or away from Netflix as a whole) was a crucial litmus test for the success of its efforts, on which the company appears to have gotten the result it was after - the majority of users (90.8 per cent) have opted to pay for streaming product. The stability of the user base taking discs-plus-streaming offers is a further boon as, for the moment, this user segment will bring in the highest ARPU.